CHINA’S iron ore and steel futures surged yesterday, tracking gains in commodities from oil to copper, as the U.S. dollar struggled after a shockingly weak U.S. employment report cut expectations for a near-term hike in U.S. interest rates.

    Data released Friday showed U.S. nonfarm payrolls only increased by 38,000 last month, the smallest gain since September 2010 and confounding forecasts for a rise of 164,000 jobs.

    Many investors have since ruled out the possibility of the Federal Reserve raising U.S. rates this month, sending the dollar to its lowest in more than three weeks versus a basket of major currencies and boosting commodities.

    All eyes will be on Fed Chair Janet Yellen who speaks at an event today. While she may temper the bearishness from Friday’s nonfarm payrolls, Mizuho Bank analysts do not see hawkish bets being revived either.

    The most-traded rebar on the Shanghai Futures Exchange closed up 4 percent at 2,059 yuan (US$314) a ton after peaking at 2,082 yuan, its strongest since May 18.

    Iron ore on the Dalian Commodity Exchange climbed 5.6 percent to 367 yuan a ton, just off the session high of 367.50 yuan, its loftiest since May 23.

    The rises in both ferrous futures follow flat to marginal gains last week as investors weighed the onset of a seasonal slowdown in construction activity this month.

    Some Chinese steel mills may be looking to build some stocks of raw material iron ore ahead of the Dragon Boat festival holidays in China on Thursday and Friday, Commonwealth Bank of Australia analyst Vivek Dhar said in a note. (SD-Agencies)